Citi Raises Target on Yahoo from Alibaba Valuation and 2 Other Hot Stocks to Watch

Yahoo shares are up around 1.75 percent Tuesday morning in heavy trading after Citigroup raised its price target on the stock from $31 to $39. Analyst Mark May wrote in a note to clients that he credited his increased valuation of Alibaba, in which Yahoo holds an ownership stake, along with ”raising our valuation for core Yahoo! based on recent strong user growth and search trends” plus higher valuation multiples for the peer group. May observed that “While pressure on Tier 1 ad prices could remain a headwind, we believe that is already known and reflected, and there are encouraging signs that the new management team’s efforts are resulting in improved user trends and mobile traction.”